This column is for investors willing to take more risk and potentially receive more reward.  The stocks mentioned in this column are not recommended to buy or sell.  They're brought to your attention so you can investigate them further to determine if they fit your risk profile.  Most of the stocks will have less than $1 billion of market capitalization, have more volatility than other stocks, and oftentimes no earnings.  And some will have tremendous stories.

April 1, 2011 - Vonage Holdings Corp. (VG-NYSE) provides voice and messaging services over broadband networks to residential, small office, and home office customers primarily in the United States, Canada, and the United Kingdom. It offers various features, such as call waiting, caller ID with name, call forwarding, and voicemail.

Further, the company offers Vonage-enabled devices, such as Vonage V-Portal to connect up to two Vonage lines through a high-speed Internet connection and includes a networking router; analog telephone adapters, which convert analog audio signals into digital data packets for transmission over the Internet; integrated adapters and wireless routers; Vonage Bundled Cordless Phone and V-Portal; V-phone, a USB compatible device; and Vonage Companion, a downloadable softphone. As of December 31, 2010, it had approximately 2.4 million subscriber lines in service. The company was incorporated in 2000 and is headquartered in Holmdel, New Jersey.

This stock sold for 30 cents a share at the beginning of 2009. Investors gave up on it. And why not. 2008 finished with a loss of 22 cents which followed 2007's loss of 81 cents. But those were good years. In 2006, the loss was $3.59 a share. By the end of 2009, however, the red ink turned to black, and the company reported a positive 2 cents a share. Last year finished with 22 cents. Expect even better numbers this year. 2 analysts have a consensus estimate of 28 cents (with a range of 23 cents to 32 cents). In 2012, look for 25 cents.

Management is sure subscribers will increase this year. In the fourth period of last year, net new accounts were 5848. That's the first net positive quarterly figure in over 2 years. The reason: a new international calling service plan was offered, as well as new VoIP service features, and applications for mobile wireless devices. These new offerings are holding current customers (turnover rate is down to 2.4%) and adding new ones. The new Vonage World program with its international calling feature is a big hit in the Hispanic, Asian and Indian markets. Filipino subscribers are also rising. The company is looking to expand its foreign operations beyond Canada and the U.K., considering partnerships or joint ventures. International most likely be the segment that shows the best growth over the next several years.

Costs are going down at VG, even with the launch of new products and expanding into international markets. 2010 showed better Operating and Profit margins. Along with focusing on high margin offerings, the company has enhanced its operating processes and network efficiencies with new technology and better wholesale prices from phone carriers. Another positive influence: restructuring its debt ($191 million) with a lower interest rate. With its infrastructure in place, additional volume will enhance margins further.

Essential numbers: Revenues for the last year were $885 million. Price to sales ratio is 1.09. Book value is negative 59 cents. Operating margin for the last 52 weeks was 10.92% and Profit margin was -9.45%. Return on assets was 21.05%. Total cash is $78.93 million or 36 cents a share. Current ratio is .65. Beta is 1.53. In the last 52 weeks, the stock isup 216.30%. There are 221.62 million shares Outstanding with a Float of 135.95 million. Insiders own 37.82% of the stock. Institutions have 36.80% of the Float. There is no dividend.

Aggressive investors always like a turnaround story. This is one more to consider. With better products, new markets and wider margins, management has addressed many of the problems that caused losses for years.